Twelve teams vied for the prize. Perhaps not surprisingly, reflecting the strong agricultural heritage of the Buckeye state, several of the contestants had a strong biomass or agricultural bent to them. Somewhat surprisingly, given the thin-film solar capabilities so strongly embedded in the Toledo area, no photovoltaics concepts were promoted.

The winner of the event was Amplified Wind Solutions (AWS), a start-up venture commercializing a technology born in the laboratories of Prof. Majid Rashidi at Cleveland State University (CSU). As the name connotes, Prof. Rashidi’s technology is an innovative concept for wind energy generation: using cylindrical towers as a means of channeling higher velocity and higher density wind flows to turbines mounted on the sides of the towers in the zones where the wind has been “amplified” by the tower. The claim is that such amplification can yield 4-6 times as much energy capture from the wind as a comparable “unamplified” wind turbine.

A key reason underlying the victory of AWS was the strength of the presentation made by its CEO, Niki Zmij. As is evidenced from this video, Ms. Zmij, an MBA student at CSU, was passionate, clear and confident in her pitch. Certain other teams were touting very interesting technologies that could be winners in meaningful markets – although their chances for commercial success were far less well-articulated.

Those teams that didn’t win shouldn’t necessarily be discouraged. It should be noted that AWS missed the cut in the prior year’s challenge, and has subsequently been polishing its story for a year. With additional time and effort to refine their stories, success may come to the runners-up in future years. Stay tuned.

All told, I was extremely impressed and encouraged by the commitment to cleantech entrepreneurship being demonstrated by so many of today’s students and tomorrow’s future leaders in Ohio. I sat humbled in the awareness that I, at a similar age 30 years ago, could not possibly have stood in front of a sizable audience baring my soul by promoting an uncertain business proposition – nor even to have such a risky aspiration as pursuing a professional path that didn’t involve someone paying me a safe salary.

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The transition to cleantech – some would call it a revolution – inevitably entails change, which implies risk. In turn, this implies that some things will fail.

We’ve already seen more than a few failures, and we’ll no doubt see many more.

As long as the successes outweigh the failures, that’s all that ultimately matters. Indeed, sometimes failure actually enables later successes.

As Thomas Edison has been quoted, “I have not failed. I’ve just found 10,000 ways that won’t work.” And, then finally — ta-da! — he discovered an approach that worked for the incandescent lightbulb, thereby changing the world forever.

But, sometimes failures can get in the way of success – particularly, if they’re the wrong kind of failures.

Edison failed quickly, cheaply and – perhaps most importantly – invisibly. Some of cleantech’s most painful failures have been anything but.

Consider two prominent examples: Solyndra and A123. The technologies being developed by the two companies actually work well enough, but couldn’t compete effectively in the marketplace.

The management teams and the backers of these companies promised great things with premature hype in innumerable press releases. The companies blew through lots of capital – including substantial government funding.

Then, they fly off the cliff and go bust, and the media and blogosphere — much of which is adverse to cleantech — report their demises with barely-hidden Schadenfreude.

OK, so it’s not like a mass shooting spree: no-one got killed in these failures. But equity holders lost every dollar, creditors took a deep haircut, taxpayer money was wasted, and pretty much everyone active in the cleantech sector gets tainted by extension.

As bad as economic failures, worse is when technologies fail because they simply don’t work.

These visions returned to me during a recent trip to Oahu, where my lodging provided me an ongoing view of the Kahuku windfarm standing idle in the face of a week of strong trade-winds. My first thought was a serial failure of the turbines – a relatively new 2.5 megawatt design from Clipper, a manufacturer with known technical issues.

However, as this report indicates, the root cause of the shutdown was unrelated to the wind turbines, but rather some problem with a set of grid-scale batteries being developed by Xtreme Power, and being piloted at the site to test the ability of such batteries to buffer the variable output of a windfarm. The pilot deployment had caused not one but three fires somehow involving the interconnection between the windfarm and the Hawaiian Electric grid, thus causing the windfarm to be idled while sorting out the battery issues.

Why weren’t these batteries tested in smaller scale and in a less obvious setting? Not only is the image of Xtreme Power (and grid-scale energy storage) being adversely affected, the long shutdown of Kahuku is dampening enthusiasm for wind energy in Hawaii.

It is these kinds of visible economic or technical failures that give the cleantech sector a black eye. The bad reputation diminishes civic goodwill, support for favorable public policies, and appetite for private capital to be allocated to the sector.

Unlike Edison’s failures, largely unnoticed by the rest of the world while he returned again and again to the drawing board, visible cleantech failures are distinctly unhelpful.

Such episodes are very painful for those of us on the sidelines working humbly to maintain forward progress in spite of the setbacks that inevitably occur in this long and challenging cleantech transition.

In the venture capital world, it is axiomatic to fail fast, so as to minimize capital at risk. For cleantech, this adage should be modified: fail fast, and stealthy.

The implication: cleantech ventures — and their investors — are well-advised to maintain a low profile for a long time, until their success is reasonably assured. It’s far better to underpromise and overdeliver than vice versa. Humility is essential. Premature bragging is very easy to eviscerate by the pundits hungry for a tussle when things later go bad.

The more that cleantech entrepreneurs can avoid shooting themselves in the foot when the spotlight is on them — first and foremost, by not encouraging the spotlight to be shined upon them — the better.

Cleantech venture capital may never again reach the heights (at least in terms of dollars invested) of 2011. As Kachan notes, and I concur, that’s not necessarily a bad thing. It just means that capital-inefficient deals that used to attract VC dollars won’t so much in the future. And, it means that a lot of ineffective cleantech VCs will be washed out of the sector. Moreover, other sources of private finance – especially corporates, but also family offices and sovereign wealth funds – will step in.

The solar and wind sectors face increasing challenges because grid-scale energy storage technologies aren’t coming to the fore as expected. Dispatchable power sources with lower emissions will gain ground. This is especially the case for natural gas, but Kachan controversially also sees a growing role for new nuclear technologies.

Clean-coal technologies become less oxymoronic. Great quote here: “No, clean coal doesn’t exist today. But that doesn’t mean it shouldn’t.” Kachan claims to have visibility on some promising new technologies in this realm. Personally, I’m a little skeptical – I’ve heard such things many times before – but I’d be glad to be wrong.

Significant improvements are afoot for internal combustion engines, further stifling the advent of electric vehicles (EVs). I agree with Kachan that a lot is being undertaken to improve the old piston engine. Those innovations being pursued by tier one auto suppliers have a fair chance of quick adoption. However, a lot of the potential breakthroughs I’ve heard about are being explored by venture-backed start-ups or garage-tinkerers, and I am less optimistic than Kachan appears to be that these companies can make large inroads into the incredibly demanding automotive supply chains within a year.

Mining and agriculture will become more important segments of the cleantech sector. Especially with respect to agriculture, I agree with Kachan wholeheartedly, as increased corporate venture activity is beginning to burble in such stalwarts as Monsanto (NYSE: MON), Syngenta (NYSE: SYT), and Cargill.

Though I haven’t gone back to review his track record, Kachan claims a good history of prognostication from recent years. I think many of his views for the near-future are justified and hence likely (if not for 2013 then more generally for the next couple of years), but he’s thrown in enough unconventional wisdom to make things interesting.

To our analysis, 2013 is shaping up to be something of a year of backtracking for the cleantech industry, a year that calls into question some of its traditional leading indicators of health, and one that surfaces long term risk to such cleantech stalwarts as solar, wind and electric vehicles.

Do we think cleantech is finished? Not at all. But much like young Skywalker learned in Episode V, cleantech is about to find out that the Empire sometimes gets its revenge.

Cleantech venture investment to decline – Expect worldwide cleantech venture capital investment in 2013 to decline even further than it did in 2012, never to return to the previous highs it achieved before the financial crisis of 2007-2008, we believe. Among the factors: the departure of many venture investors from the sector because of disappointing returns, poor policy support worldwide and a lag time in the pullback of equity and debt investment.

But this doesn’t mean the sky is falling in cleantech. Family offices, sovereign wealth and corporate capital are now having more significant roles, filling gaps where traditional VC has played in recent years. It’s a sign the sector has matured, we believe. Fewer VC cooks in the kitchen may indeed impede innovation, but deep pocketed corporate capital should help clean technologies that are already de-risked reach more meaningful levels of scale.

Long term risk emerges for solar and wind – The solar and wind markets suffer today from margin erosion, allegations of corruption, international trade impropriety and other challenges. In 2013, we think poor progress in grid-scale power storage technology will also start to put downward pressure on solar and wind growth figures. Prices per kilowatt hour are falling, yes, but the cost of flow batteries, molten salt, compressed air, pumped hydro, moving mass or other storage technology needs to be factored in to make intermittent clean energies reliable and available 24/7. When also considering continued progress in cleaner baseload power from new, emerging nuclear technologies, natural gas and cleaner coal power, the growth rates for solar and wind appear increasingly at risk.

Clean coal technologies gain respect – We predict 2013 will be the year a new set of technologies will emerge aimed at capturing particulate and CO2 emissions from coal fired power plants and help clean coal technologies begin to overcome their negative positioning. The barrier to capturing coal emissions has been cost and power plant output penalties. Our research has identified encouraging new technologies without such drawbacks, and we think the world will begin to see them in 2013. China is expected to target domination of the clean coal equipment market, like it does already in many other cleantech equipment categories.

The internal combustion engine strikes back, putting EVs at risk – Important innovations quietly taking place in internal combustion engines (ICE) could further delay the timing of an all-electric vehicle future, we think. In 2013, unheard-of fuel economy innovations in ICEs will enter the market, including novel new natural gas conversion and heat exchange retrofits of existing engines aimed at dramatically lessening fuel needs. Some of these technologies, when combined, claim to be able to reduce fuel costs by 90%. That could push out the timing of EV adoption.

Cleantech adoption in mining – Notoriously conservative mining companies and their shareholders are starting to realize that the capital expenses of new clean technologies can be offset by reduced operating costs and the potential for new revenues. In 2013, we predict more adoption of cleantech innovation in mining, in areas such as tailings remediation, membrane-based water purification, sensors and telematics, route optimization software intended to lower fuel and equipment maintenance costs, and low water and power hydrometallurgical and other novel processes for mineral separation.

Big ag steps up and cleans up – We estimate that 2013 will be the year the world’s leading agricultural companies embrace new innovation in significant ways. Expect accelerated corporate investment, strategic partnership and agricultural M&A in 2013, as agricultural leaders race to meet consumer demand for cleaner, greener ways of producing food, having weathered intense consumer GMO-related and other backlash.

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In recent months, I’ve come across more work being done in flow batteries than I’ve seen in the prior decade.

I’ve been known in the past to say that fuel cells are kinda like fueled batteries. Well, flow batteries really are fueled-batteries. A traditional chemical battery is one sealed system that charges and discharges chemical elements through a set of electrodes, and the amount of charge/discharge is dictated by the type and volume of chemistry within the battery. In contrast, a flow battery separates the electrodes from the chemistry, which is stored externally from the electrodes in tanks. In so doing, a flow battery delinks the relationship between power (an instantaneous concept) and energy (power over time) that is essentially hard-wired within a chemical battery. In a flow battery, it’s straightforward to expand the energy of a system by adding more to the storage tanks. And, it’s straightforward to add more “fuel” by injecting more of the reactants into the storage tanks.

Because of this, it is natural to think about how flow batteries can improve the range of electric vehicles, which is the focus of this 2009 article from The Economist. However, energy density remains a challenge that could limit the utility of flow batteries for vehicular purposes.

Most of these efforts are targeting to apply flow batteries in grid-scale electricity storage at the substation level. This could be an even more impactful role for flow batteries than their use in vehicles: if flow batteries can provide an economic solution for grid-storage, the implications for expanded renewable energy deployment — enabling intermittent wind and solar energy to achieve more than 15% share of power generation — are possibly massive.

It’s not just any wind turbine. For those who have driven on I-90 lately, the turbine is impossible to miss: a 2.5 megawatt unit manufactured by Kenersys, towering 443 feet into the air just a few hundred yards south of the highway. It’s certainly the largest turbine in Ohio, and may be the largest turbine installed for “behind-the-meter” use by a customer anywhere in the U.S.

Because of its size, the hurdles in the development process were unusually large for a customer-sited wind turbine installation. Kudos must go to Seth Mason, Lincoln’s manager for energy procurement, assisted by many but especially Steve Dever of Cuyahoga County’s Great Lakes Energy Development Task Force, for utter perseverance in getting this project over the goal line since its conception a few years ago.

The motivation behind the project is also uncommon. Of course, Lincoln wants to reduce its energy bills and exposure to future price increases. Projections indicate that the turbine will supply about 90% of the annual energy requirements of Lincoln’s corporate headquarters.

But the project represents much more than a financial investment to reduce Lincoln’s operating costs. In his remarks at the dedication, Lincoln’s CEO John Stropki extolled the symbolic virtues that the wind turbine represents in showing to local citizens that the region is not stuck in the past but is embracing and participating in the high-tech cleantech future.

As a corporate citizen in the Cleveland area for over 100 years, it’s nice that Lincoln is concerned about the future health and dynamism of the region, and is making a non-portable investment that further cements their commitment to the area.

Or should I say “further welds their commitment”? The corporate name “Lincoln Electric” is a bit misleading: Lincoln Electric is not a utility like Wisconsin Electric or Hawaiian Electric, nor a household-name manufacturer of electrical products like General Electric or Emerson Electric. Like many companies in the Cleveland area, Lincoln Electric is a multi-billion dollar corporation that nevertheless toils in relative obscurity, making products and offering services globally in the industrial sector – in Lincoln’s case, electric arc welding equipment and consumables (e.g., flux).

Wind energy is one of the biggest growth areas in Lincoln’s business: they are an important vendor in towers for wind turbines, supplying welding machinery to the tower manufacturers as they fabricate the massive cylindrical tower sections. The tower in their own Kenersys turbine installation utilized nearly 6,000 pounds of Lincoln’s flux. It’s thus very much in Lincoln’s interests to support the growth of the wind sector.

The strategic dimensions of the project, and particularly the selection of a Kenersys turbine, are also notable.

A newcomer from Germany to the U.S. market, with a turbine design of a strong pedigree, Kenersys needs a good reference customer – a showcase, if you will – for prospective American customers. The Lincoln wind turbine site, near a major city and airport – a hub for United Airlines (in the wake of its merger with Continental Airlines) – is good for this purpose.

Presumably, eager to show its turbine in the U.S., Kenersys was aggressive on pricing and support for the Lincoln project.

More importantly, as their U.S. order book grows, Kenersys will also need a domestic location for assembly. Lincoln has some spare industrial capacity at its corporate campus, and the hope is that Kenersys will utilize this already-extant capability to reduce start-up costs and speed-to-market – while providing an additional source of value to Lincoln.

For those of us who make the Cleveland area home and extol its virtues in the face of its challenges, let’s hope that Lincoln Electric truly feels as committed to the wind business and to our region as the company indicated last week in their comments, and steps up to the plate as needed when the time comes for Kenersys to decide on location for U.S. assembly and make an offer that Kenersys can’t refuse.

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Late May, the wind industry flocked to Anaheim for its annual gathering, Windpower, hosted by the American Wind Energy Association (AWEA). For the first time in quite awhile, attendance was down from the previous year – estimated at 14,000, compared to a reported 25,000 in Dallas in 2010. At least part of the reason was geographic: it’s simply more time-consuming and expensive for many to travel to the West Coast as opposed to the center of the country. However, there’s no doubt that the vibe was more subdued.

I returned from the show ruminating on several questions:

When will new players stop entering the wind turbine market? I am not exaggerating when I estimate the number of companies with turbine products on display at 50. I have never heard of many of these companies, but somehow they must be able to somehow scrounge up what clearly is a significant amount of capital to amass the tooling, fabricate at least a few units, and design and staff fancy and massive booths. A number of these no/new-name companies are Asian, presumably with lots of excess cash and considerable naivete on how to penetrate the North American wind market. The rush is probably five years too late and clearly unsustainable – but it seems to be getting more acute rather than better. As the old adage from the financial sector says, “the market can stay irrational much longer than you can stay solvent.” If any of these “who-dat?” companies were public, I’d recommend shorting them.

What will happen to the production tax credit (PTC)? It’s been shown vividly that the wind industry suffers from booms-and-busts in cycles as the dominant U.S. policy pertaining to wind, the PTC, is allowed to expire and then is extended (typically for no longer than the two year duration of a House member). It’s due to expire (again) at the end of 2012, and while the industry is optimistic about a good 2011 and 2012, after that is a guessing game – particularly in the current political climate and budget woes. The only consensus is that the PTC won’t be addressed at all until the lame duck session after the 2012 election, but it may not be dealt with at all until 2013 – in which case the North American wind industry will experience a big setback (again).

What about domestic manufacturing for wind? Over the years, a major force for political support to the wind industry has been the participation – both actual and potential – of American manufacturing in the supply chain. Based on some murmurings of industry insiders, it appears that the American supply chain is in fact getting more stressed and less competitive relative to foreign (mainly, you guessed it, Chinese) sources. If American manufacturing continues to lose ground in the wind sector, one of the most important pro-wind voices will stop throwing its considerable weight around – and the North American wind market will be the worse for it. Stay tuned for domestic content debates, and/or examples of “reshoring” production of components back to the U.S.A., to patch this potential hole in the wind dyke.

How will onshore wind co-exist with offshore wind? In Europe, this has been a non-issue, because the wind industry basically had to move offshore as all the plausible sites onshore had been developed. Not so straightforward in the U.S.: the vast majority of the wind industry remains focused on still-ample onshore wind opportunities and doesn’t want to see any resources or policies diverted from its objectives in order to support the emergence of a new segment of the wind industry offshore. For those who are interested in accelerating the potential of offshore wind (such as myself), especially in places of the U.S. east of the Mississippi River where most of the demand and transmission exists but good onshore wind opportunities are much more limited, the competing interests of the more well-established onshore wind industry is a frustrating source of tension. It’s a microcosm of the U.S. economic system: protecting the near-term by minimizing the long-term. This dilemma is the main reason that the Offshore Wind Development Coalition was established, so that offshore wind interests could independently express themselves in the corridors of D.C. Alas, the distinction between onshore wind and offshore wind is lost among most public officials, so the existence of multiple organizations that seemingly are operating in parallel in advocacy and education is not a helpful fact to both segments of the wind industry.

It’s never easy to make it in a sector that must fight entrenched incumbents with economic advantages, but the next couple of years in the U.S. wind market will likely be an especially bumpy ride.

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Our Promising Future of Renewable Energy

The cleanest solutions to global warming, air pollution and energy security are wind, water, and solar power (WWS). As Dr. Mark Jacobson walks me through the numbers of his, Dr. Mark Delucchi, and their teams’ multi-year study, the renewable energy solution stands out as the clear winner. Dr. Jacobson is a Professor of Civil and Environmental Engineering at Stanford University and an advisor to the U.S. Department of Energy.

Wind power has been doubling in capacity about every three years. It’s now over 200 GW; in 3 years it will be over 400 GW. 36 U.S. states generate enough wind power to replace one or more coal or nuclear power plants. U.S. wind grew 39 percent in recession year 2009. In a growing number of global locations from Hawaii to Denmark, wind is the least expensive way to generate power. Their WWS study includes both on-shore wind power, which is plentiful from Texas through the Dakotas and offshore with enormous potential along our Pacific and Atlantic coasts and our Great Lakes.

Solar includes the photovoltaics that cover homes and the faster growing PV that covers commercial roofs. It also includes the grid-scale PV and concentrating solar power (CSP) that generates the equivalent power of a natural gas or coal plant. The water in WWS includes hydropower, our most widely used source of renewable energy, and geothermal power, which uses steam to drive turbines. Water also includes emerging, wave and tidal power generation.

WWS can meet all of our needs for electricity. WWS can also meet all of our need for heat and for transportation.

At the same time that we see high growth of WWS, especially wind and solar power, we are also experiencing transformational growth of electrified transportation. Mark Jacobson points out that electric propulsion is four times as efficient as internal combustion. Health concerns, energy security, and economics make combustion a loser. Every year we see more battery electric vehicles (BEV), electric rail, and even hydrogen fuel-cell vehicles (HFCV) such as the 20 buses that transported 100,000 visitors during the last Winter Olympics.

From a technology standpoint WWS can meet all of our needs in 20 to 40 years. How far and how fast we move to reduce greenhouse gas and health-damaging emissions depends more on politics, sunk-costs and inertia than on what is feasible. Faced with the growing threats of global warming such as heat waves, water scarcity, failed food production, continued growth of WWS is essential.

By 2015, several forecasts put one million to 1.5 million electric cars on the U.S. road. Having recently purchased a Nissan Leaf, I believe the forecast. My electricity bill is a fraction of what I paid at the gas station to put on the same miles. With current incentives, my electric car cost $22,000. Prices are likely to decline for electric cars while gasoline prices are forecasted to increase.

Mark Jacobson has driven his Tesla Roadster 16,000 miles. He charges his Tesla with the same solar photovoltaics that power his entire house. By going to energy efficient electric appliances and solar water heating, their utility bill is at the minimum needed for a couple of gas burners on the stove for a few favorite meals. Mark and his wife don’t just talk about the transition to WWS – they live it.

With the 240-mile range of his Tesla Roadster, range has rarely been an issue. Yes, on a trip to Sacramento, he had to plug his Level 1 charger into the outlet in his motel room, extending the cord out the window to his electric car. On one trip to Modesto, he had to convince his hotel manager to turn-off their decorative water fountain so that he could use the fountain’s electric outlet to trickle charge overnight. The vast majority of the time, he is riding on sunlight.

Public charging infrastructure is expanding, renewable energy growth continues, and lithium battery prices fall as gasoline and diesel increase in cost. Our cars are getting cleaner and more electric.

Jacobson and Delucchi looked at the lifecycle impacts of different types of cars and various fuels. Alternatives were ranked according to their impacts on global warming, pollution that impacts our health, water supply, land use, security issues such as terrorism and other impacts. The study evaluated nuclear, coal and natural gas with sequestration, advanced biofuels, and included hybrid and plug-in hybrids vehicles. Our best scoring alternatives, in the following order, are electric vehicles using renewable energy:

Wind – BEVs

Wind – HFCVs

CSP – BEVs

Geothermal – BEVs

Tidal – BEVs

PV – BEVs

Wave – BEVs

Hydro – BEVs

Pure battery-electric cars were the big winner in their study with most of their power coming from wind and solar charging. Hydrogen from wind electrolysis scores best for vehicles requiring extended range such as buses, ships using hybrid hydrogen fuel cell propulsion, and aircraft using liquefied hydrogen combustion. Mark Jacobson’s articles for Scientific American, Energy Policy, testimony to Congress and the EPA, and more can be accessed at his Stanford website.

The study used existing technology that can scale to broad commercial deployment. At first glance, growing to 11.5 TW of WWS globally looks impossible, a closer look shows that many of the study’s assumptions are conservative because only today’s technology is considered. The shift to electric vehicles powered with renewable energy will be easier if vehicles are built with much lighter materials, or if we succeed with breakthrough battery chemistry such as lithium air. The electric car/renewables scenario timetable also improves as U.S. drivers continue their trend of driving fewer miles thanks to record urban density, transit, flexwork, and aging boomers.

In Energy Policy Jacobson and Delucchi write, “”Although we focus mainly on energy supply, we acknowledge and indeed emphasize the importance of demand-side energy conservation measures to reduce the requirements and impacts of energy supply. Demand-side energy conservation measures include improving the energy-out/energy-in efficiency of end uses (e.g., with more efficient vehicles, more efficient lighting, better insulation in homes, and the use of heat exchange and filtration systems), directing demand to low-energy use modes (e.g., using public transit or telecommuting instead of driving)….”

Vehicle to Grid and other Storage

A 100% WWS United States must deal with the variability of wind and solar. This is an important reason that wind, water, and solar power are all needed to meet our 24/7 demands. Large-scale deployment of wind and solar will require a Supergrid network of high-voltage lines that can move electricity from mid-American wind farms and desert solar plants to cities and industry. With a national Supergrid, WWS is largely achievable without storage and even without using pricing and demand response (DR) to make energy demand more level. He walked me through a California study that he co-lead in 2005 showing that WWS would meet 99% of California needs, even during peak hours on a burning summer day. With our growing use of DR, intelligent energy management, and storage, large scale WWS can be deployed more quickly.

Byron Shaw of GM quipped, “Cars are like cats, they sleep 22 hours per day.” Most cars are parked when the grid faces peak demands. Why not let people make money charging at night at a discount and sell electricity back to the grid at peak at premium pricing? The model works well for individuals and businesses with solar power.

Jacobson and Delucchi write, “The use of EV batteries to store electrical energy, known as ‘‘vehicle-to-grid,’’ or V2G, is especially promising, albeit not necessarily easy to implement…. In order for V2G systems to provide operating reserves to compensate for hourly variations in wind power (again when wind power supplies 50% of US electricity demand), 38% of the US LDV fleet would have to be battery-powered and be on V2G contract.”

Yet 38 percent will not need to sign V2G contracts because V2G is just one of many ways to store wind and solar power until needed. Utilities currently use nighttime wind energy to pump water uphill. The next day at peak hours the water flows downhill driving generators. Grid-scale batteries, compressed air storage, and storage towers coupled with concentrating solar plants are all in early stage use.

Easier than It Looks

Meeting 100 percent of our energy and transportation needs with wind, water, and solar power seems as daunting as putting a man on the moon. Mark Jacobson and Mark Delucchi state in Energy Policy, “With sensible broad-based policies and social changes, it may be possible to convert 25% of the current energy system to WWS in 10–15 years and 85% in 20–30 years, and 100% by 2050. Absent that clear direction, the conversion will take longer. “

Their WWS scenario can meet our electricity, heat, and transportation needs. The technology is here, but it will take considerable political will to overcome the subsidies, market barriers, and change required to meet all needs with WWS.

In several ways, the transition will be easier in the United States. We already have more vehicles than people with drivers license, in contrast to the explosion of middle class drivers in Asia now buying their first car.

In the United States we have achieved strong growth of wind and solar. Now we are successfully deploying smart grids and electric cars. WWS does not require technology breakthroughs, yet dramatic innovation is likely in the next two decades in battery technology, solar efficiency, and urban mobility that requires fewer car miles.

Jacobson and Delucchi only assume reasonable progress in energy efficiency. New lighting technology, such as LED, can cut 80 percent of lighting’s 27 percent of total electricity demand. Making electricity cheap during vehicle charging hours and more expensive during peak hours will make a huge difference. In the United States, 80 percent WWS is achievable in the next two or three decades. 100 percent is like putting a man on the moon – it looked impossible until we did it.

Although beauty is always in the eye of the beholder, the Wintrack is arguably much more attractive than the traditional lattice tower structures seen maligning the landscapes of the world.

More important than cosmetics, by virtue of the architecture of its physical design, the Wintrack produces much smaller ambient magnetic fields than what emanate from conventional transmission towers. These magnetic fields create the buzz and static that can often be heard from high-voltage lines — and form the basis for fears (founded or otherwise) about suspected human health effects due to electromagnetic field (EMF) radiation from power lines.

Between its aesthetic and magnetic benefits, the Wintrack pylon might, just might, make it incrementally a bit easier to site new transmission lines, which in turn would help alleviate grid-constrained load centers and debottleneck access to areas of abundant solar and wind energy resources that tend to be far removed from populated areas.

According to his own bio on the book jacket, “Bryce has been producing industrial-strength journalism for two decades” –whatever “industrial-strength” is supposed to mean. And, by his own writing, he states that “I am neither a Republican nor Democrat. I am a charter member of the Disgusted Party.”

Given his angst-ridden and self-assured stance, perhaps it shouldn’t be surprising that Bryce’s narrative is laced with the type of adjective-overladen hyperbole that has come to dominate the media in our Michael Moore and Glenn Beck era – a rhetoric style that I personally find annoying and unhelpful in its seeming desire to provoke. (Though, I would pay good money to see Bryce call someone like Dr. Gal Luft an “underinformed-but-persistent sophomore” to his face as he implicitly does in writing.)

If one can get past the sometimes maddening and offensive passages, the book has its share of merits. Bryce is right to focus on facts, to seek to strip away untenable claims, and to decry the lack of clarity of thinking in the national energy discourse. Part One of the book is an occasionally masterful primer on many of the basics about energy production and consumption in the modern world, studded with facts – mostly accurate by my superficial review.

But, as the Einstein principle implies, “A theory should be as simple as possible, but no simpler.” And, in striving to simplify the energy topic by driving towards sound-bites from a massive but still incomplete set of facts, Bryce sometimes strides too far. He sometimes pieces the facts together in such a way so as to draw skewed conclusions. And, his lack of nuance – indeed, his distaste for nuance – leads ultimately to oversimplification and conclusions that are at best only partly correct.

Part Two of the book is consisted of chapters devoted to debunking “myths” about green energy. I guess it’s fair to tackle this, in that some commentators supporting green/renewable/alternative energy really have been guilty of overstating the facts and creating too much unsustainable hype as a result. Yet, for the most part, the myths that Bryce attacks are constructed in such a way as to be too easily knocked down like a cheap strawman.

For instance, the chapter entitled “Myth: Denmark Provides an Energy Model for the United States” is written as though someone actually thinks that Denmark and the U.S. are sufficiently similar that the Danish energy system can be largely replicated in the U.S. Maybe some people do actually think that the U.S. should really pattern itself after Denmark, but most of us in the energy sector know that’s a naïve thought. Even so, that’s not to say that the U.S. can’t learn valuable lessons from the Danes – and in fact, Bryce acknowledges as such in the chapter itself, though you might not notice because of the chapter title.

I could go on with a number of other examples of how Bryce makes himself a valiant protector of Joe Six-Pack by dismissing so-called “myths” that are portrayed as elitist ideals of little substantiation and hence value – even when the “myths” he’s debating are drawn in a hopelessly indefensible manner.

Bryce can’t seem to accept that, just because some people have said stupid things about green energy, it doesn’t mean that green energy is stupid.

It’s clear that Bryce is an devout disciple of the Peter Huber & Mark Mills school of energy analysis, in which energy density is the primary factor driving winners and losers in the energy sector. By this way of thinking, nuclear and fossil fuels are clearly superior to wind, solar and bioenergy, which require large footprints. It’s an intriguing perspective, and definitely applies well to mobile and transportation energy, in which density is a critical driver of commercial acceptability.

However, I’ve never been convinced that energy density is a significant factor in “stationary” energy to power, heat and cool buildings: it’s all about economics, and if the cost of land and delivery is sufficiently cheap (i.e., in a remote area connected via a delivery system), who cares how dense the energy is?

(Let’s not forget that Huber/Mills have been less than an infallible source of energy prognostication, as any reader of the fascinating but yet wholly inaccurate Huber-Mills Digital Power Report from the early 2000’s – sample forecast: ubiquity of digitally-managed distributed generation – can attest.)

It’s equally clear that Bryce passionately hates several things: virtually all political figures of all stripes, T. Boone Pickens, wind energy, and biofuels. Bryce has no use for them, can find no virtue or benefits from any of them; the dislike seems to go beyond the rational.

Putting aside politicians and Pickens, I’m well aware of the limitations of wind energy and biofuels, but that doesn’t justify throwing the baby out with the bathwater, as Bryce does. Rebuttals to Bryce’s diatribes on wind energy and biofuels can be constructed to indicate where, how, when and why wind and biofuels can indeed make sense, but it would be a Herculean task just to overcome the volume of volleys he lobs.

Part Three of the book provides Bryce’s (over)simplifying conclusion to our whole energy problem: we’re finding immense amounts of natural gas in shale, more than we could have ever expected a few years ago, so we need to use all of this to bridge to a nuclear future, which is the ultimate long-run solution and for which technology and economics will ultimately prevail. As Bryce calls this vision of natural gas to nuclear, N2N.

I’m not intrinsically against increased utilization of natural gas and nuclear energy. I’m more sanguine about the natural gas – though I don’t know if the shale plays will have the duration Bryce expects, due to the steep decline curves encountered so far – than I am about nuclear energy, which both has poorer current economics and lower public acceptability than the wind energy that Bryce damns to high heaven. (And, Bryce is super eager to gladly accept all the hype he can accumulate on nuclear energy, especially about waste management safety and fuel recycling technology advancement.)

The problem I have with Bryce’s N2N synopsis – the oversimplification resulting from his lack of appetite for nuance – is the “silver-bullet” mentality about energy that has played a large part in getting us to where we are today. Bryce seems to think that there should be one answer for most if not all our energy needs: natural gas in the immediate future, nuclear in the longer future. He doesn’t see a future for renewable energy, in large part because he seems to think that something that represents only a part of the solution isn’t really a solution.

I disagree, and believe we need a highly diversified all-of-the-above energy strategy, as I don’t see a one-size-fits-all energy approach as workable. For example, if wind can supply 15% and solar 15% of our needs (at prices that are likely to decline with volumes to levels approaching competitiveness with fossil fuels), that shouldn’t be pooh-poohed just because it doesn’t supply a majority of our needs. Indeed, going from less than 1% to more than 10% in either of these forms of energy represents a huge growth potential and huge wealth creation opportunity.

Notwithstanding its flaws, I do recommend cleantech advocates read the book. It is cited widely by opponents of renewable energy and media articles and outlets unfavorable to renewable energy, so it’s good to have read the raw source material.

Though you may need to have some industrial-strength antacid at your side when reading his so-called “industrial-strength journalism”.

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This week I’m going to break one of my self-imposed ‘blog’ rules and dip into last week’s news. My reasoning will become clear.

On Thursday I attended Envirolink North West’s Developing New Technologies for off Shore Wind event at the Met in Leeds. Apart from gaining a new respect for gearboxes (not to mention the humble bearing), I was struck by a presentation delivered by Dr. Mike Barnes of the University of Manchester and Siemens Transmission and Distribution arm.

In particular, he highlighted a ‘desertec’ vision for future energy generation, whereby huge swathes of African and Middle Eastern deserts are used for the generation of solar and wind energy. Drawing on commentary delivered by Matthias Ruchser and Stefan Gaenzle of the German Development Institute (Deutsches Institut für Entwicklungspolitik DIE) on Deutsche Welle, Dr Barnes outlined that, once technology and cost allows, Africa could become a major source of energy.

The Desertec project aims to feed solar power from Africa and the Middle East to the EU Thursday night brought a counter perspective at EcoConnect’s Green in the City Event: ‘Future of Solar’ at the London HQ of City law firm SNR Denton. Although heavily slanted towards the investment and banking community, these events always deliver a valuable and informed insight.

Expert panel member Paul McCartie of Investec Capital Markets dismissed ‘desertec’ as unworkable. Sighting “energy security” as the primary issue, he commented: “Following the recent problems caused by a dependency on Russian gas supplies, I can’t see Europe relying on energy generated in African and Middle Eastern nations.”

Good point. Would folks in Milton Keynes rely on a light switch powered by electricity generated in the Sudan?

Last week, Environment writers Louise Gray in the Telegraph and John Vidal in Guardian offered a hint as to what the future may hold.

Both reported on a controversial announcement from International Development Secretary Andrew Mitchell MP that the Coalition Government was committing taxpayers’ money: “To encourage private investors to put their funds towards ‘green’ development projects in Africa and Asia.” Mr Mitchell said: “In Africa, a potential new fund could see up to 500MW of renewable energy per year from 2015 – enough to provide for over 4 million rural households. In Asia the project could generate 5GW of new renewable energy and create 60,000 jobs.” he said.

Aid agencies greeted the news with immediate skepticism: Would private investors be doing this just to bring light and jobs to some of the most energy deficient and impoverished places on earth? Of course not, and Government wouldn’t expect them to.

So what’s going on here? Well, if the near ‘third-world’ is to be explored as a potential source of energy then this could be a sensible way to go – encourage investment under the guise of aid. As for security, Matthias Ruchser and Dr. Stefan Gaenzle are of the opinion that: “renewable energy sources promote development, and development promotes security.”

So what leads us to believe that the development of African renewable energy will not be just an extension of the model followed by other large extractors of raw materials from the continent? The Angola and Nigerian oil fields are by no means models of security and progressive regional development.
Does renewable energy offer an opportunity for a new, fairer approach to international development, or will the same energy security problems prevail?

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I had a fascinating presentation today from John Robertson, managing director of BiFab, one of the first movers in offshore wind platform fabrications. They just rolled off doing a 31 unit, 14 month project for Vattenfall’s 150 MW Ormonde project (which still counts as large in the offshore wind business), and built the original Beatrice prototype jackets. They also sold 15% of the company to offshore wind developer SSE, essentially a vertical integration highlighting just how fragile the supply chain actually is.

There are three types of offshore mounting systems for wind 1) monopile (think big cylinder), 2) jacket, or 3) floating (of which the only prototyped system, though not yet at full scale, is a spar (floating upright hollow cylinder). Essentially those are in order of depth capability, with the 50-200 foot range the province of jackets, shallower water for monopiles, and at the 150 foot+ range a floating system is needed.

And right now we’re in the offshore wind’s infancy, still building one-offs. At scale, this has to change. The wind turbine industry is already able to product final turbine assemblies within days to weeks. The rest of the supply chain for offshore is going to have to match that if the industry is to deliver the scale in the pipeline.

BiFab for example, builds jacket type mounting systems (basically four legged lattice tower) in Scotland for the offshore wind market in the North Sea. Which sounds like a totally boring exercise. Until you realize the following facts:

The offshore wind development pipeline in the UK is measured in multi-gigawatts, equaling 1,000+ plus platforms over the next 10 years. Forget transmission constraints. Just getting that much steel in the water fast enough at a low enough cost is an almost ungodly constraint.

The platforms are smaller, lighter, and have to cost much, much less, and be installed in a fraction of the time that the oil & gas industry has traditionally done.

Basically the fabrication shop has to learn to cookie cutter a product, not fabricate a series of one-off. Think order of magnitude three per week from a facility. Nobody in the marine industry has done that since the Liberty Ships in World War II. Nobody. This is closer to manufacturing transformers or aircraft than it is shipbuilding or offshore construction except the end result has to in 50-150 feet of salt water.

I mean, when was the last time you heard a fabricator talking about manufacturing process technology, scale up and licensing designs. They assemble steel. Yet in offshore wind, that isn’t going to work. Heavy steel has to meet cleantech for heavy steel to find new markets, and cleantech to reach scale. It will be an interesting experience.

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This past week in New York, at its annual East Coast investor forum, the Cleantech Group released its 2010 Global Cleantech 100, profiling the private cleantech companies that a set of panelists thinks has the most promise for large long-term impact.

Energy efficiency displaced solar as the subsegment of cleantech with the most firms on the list, with 15. Solar and biofuels each account for 14 companies on the list. As big and active as the segment is, only one company in wind energy made the list.

The U.S. remains the dominant geographic region for cleantech (55), with California far and away the leading state (33), and no other state with more than 8 (Massachusetts). However, Asia-Pacific (especially China) is fast on the rise.

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The United States now has a new source of clean electricity for homes, buildings, and industrial stationary power and also for the growing use of electricity in rail and electric cars. Wind power is especially available at night when we hope to eventually charge millions of vehicles.

Global wind energy capacity is increasing by 160% over the coming five years from 155 GW to 409 GW, according to the annual industry forecast presented by the Global Wind Energy Council (GWEC). A growing part of the renewable energy (RE) mix is off-shore wind, popular in Europe for 20 years, but stopped in the U.S. by not-in-my-backyard opposition, or more accurately “not in the view of my expensive ocean front property.”

Secretary of the Interior Ken Salazar showed political courage on April 28 by approving the Cape Wind renewable energy project on federal submerged lands in Nantucket Sound. He will require the developer of the $1 billion wind farm to agree to additional binding measures to minimize the potential adverse impacts of construction and operation of the facility. Salazar said,” With this decision we are beginning a new direction in our Nation’s energy future, ushering in America’s first offshore wind energy facility and opening a new chapter in the history of this region.”

The project is a big win for Siemens who will supply 130 3.6 MW towers, outbidding GE, Vestas, and other competitors. Siemens has already sold over 1,000 of these large off-shore turbines. The Cape Wind facility will generate a maximum electric output of 468 megawatts with an average anticipated output of 182 megawatts. At average expected production, Cape Wind could produce enough energy to power more than 200,000 homes in Massachusetts, or charge 200,000 electric cars.

One-fifth of the offshore wind energy potential of the East Coast is located off the New England coast and Nantucket Sound receives strong, steady Atlantic winds year round. The project includes a 66.5-mile buried submarine transmission cable system, an electric service platform and two 115-kilovolt lines connecting to the mainland power grid. The project would create several hundred construction jobs and be one of the largest greenhouse gas reduction initiatives in the nation, cutting carbon dioxide emissions from conventional power plants by 700,000 tons annually.

Over one GW of off-shore wind is proposed for other Eastern coastal states, eager to catch-up with the renewable energy use of Western and Central states. For example, due to California’s abundance of wind, solar, and geothermal power, my California utility does not use coal.To overcome years of opposition, the number of turbines at Cape Wind has been reduced from 170 to 130, minimizing the visibility of turbines from the Kennedy Compound National Historic Landmark; reconfiguring the array to move it farther away from Nantucket Island; and reducing its breadth to mitigate visibility from the Nantucket Historic District. Translation is that from shore it will take Superman vision to notice the wind turbines 5.2 miles from the mainland shoreline, 13.8 miles from Nantucket Island and 9 miles from Martha’s Vineyard.

A number of tall structures, including broadcast towers, cellular base station towers, local public safety communications towers and towers for industrial and business uses are already located around the area. Three submarine transmission cable systems already traverse the seabed to connect mainland energy sources to Martha’s Vineyard and Nantucket Island.

“After almost a decade of exhaustive study and analyses, I believe that this undertaking can be developed responsibly and with consideration to the historic and cultural resources in the project area,” Salazar said. “Impacts to the historic properties can and will be minimized and mitigated and we will ensure that cultural resources will not be harmed or destroyed during the construction, maintenance, and decommissioning of the project.”Renewable Energy Reports and Articles

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The U.S. wind energy grew in 2009, despite a severe recession. There are 36 states that have utility-scale wind projects and 14 states are in the “Gigawatt Club” with more than 1,000 MW of installed wind capacity per state. In state rankings, Iowa leads in terms of percentage of electricity from wind power, getting 14% of its power from the wind, and also leads in highest number of jobs in the manufacturing sector. Texas consolidated its lead in wind capacity and in largest wind farms installed, according to the annual wind industry market report by the American Wind Energy Association (AWEA).

“Jobs, business opportunities, clean air, energy security—wind power is delivering today on all those fronts for Americans,” said AWEA CEO Denise Bode. “Our annual report documents an industry hard at work and on the verge of explosive growth if the right policies—including a national Renewable Electricity Standard (RES) — are put in place. A national RES will provide the long-term certainty that businesses need to invest tens of billions of dollars in new installations and manufacturing facilities which would create hundreds of thousands of American jobs.”

Highlights from AWEA’s new report include:

•The U.S. wind energy industry installed over 10,000 MW of new wind power generating capacity in 2009, the largest year in U.S. history, and enough to power the equivalent of 2.4 million homes or generate as much electricity as three large nuclear power plants.

•In industry rankings, GE Energy remained #1 in U.S. wind turbine sales; NextEra Energy Resources continued to lead in wind farm ownership; and Xcel Energy continued to lead utilities in wind power usage. At the same time, however, more companies are now active in each of these areas, showing that the wind energy market is diversifying as it expands.

•The report’s section on manufacturing shows that in spite of a slowdown in wind turbine manufacturing in 2009 compared to 2008, 10 new manufacturing facilities came online in the U.S. last year, 20 were announced, and nine facilities were expanded. The largest category was wind turbine sub-components, such as bearings, electrical components and hydraulic systems. In all, the U.S. wind energy industry opened, announced or expanded over 100 facilities in the past three years (2007- 2009), bringing the total of wind turbine component manufacturing facilities now operating in the U.S. to over 200.

•All 50 states have jobs in the wind industry.

•Approximately 85,000 people are employed in the wind industry today and hold jobs in areas as varied as turbine component manufacturing, construction and installation of wind turbines, wind turbine operations and maintenance, legal and marketing services, transportation and logistical services, and more.

•To ensure a skilled workforce across the wind energy industry, 205 educational programs now offer a certificate, degree, or coursework related to wind energy. Of these 205 programs, the largest segments are university and college programs (45%) and community colleges or technical school programs (43%).

•Despite the economic downturn, the demand for small wind systems for residential and small business use (rated capacity of 100 kW or less) grew 15% in 2009, adding 20 MW of generating capacity to the nation. Seven small wind turbine manufacturing facilities were opened, announced or expanded in 2009.

•Offshore wind power is gaining momentum in the U.S. The report lists seven projects with significant progress in the planning, permitting, and testing process. Both the federal government and several states established significant milestones in 2009 to encourage offshore wind power development.

•America’s wind power fleet of 35,000 MW will avoid an estimated 62 million tons of carbon dioxide annually, equivalent to taking 10.5 million cars off the road.

•America’s wind power fleet will conserve approximately 20 billion gallons of water annually that would otherwise be lost to evaporation from steam of cooling in conventional power plants.

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Dr. Steven Chu, Secretary of Energy and co-winner of the Nobel Prize for Physics (1997) delivered this speech “Meeting the Energy and Climate Challenge” at Stanford University on March 7, 2010, where he was formerly a professor.

Dr. Chu called on the students and faculty to take part in a new Industrial Revolution. At the epicenter of Silicon Valley, Stanford has been at the heart of the Information Technology Revolution – a catalyst for innovators such as Intel, Cisco, and Google. “America has the opportunity to lead the world in a new industrial revolution,” he was quoted in the Stanford Report.

Humans are causing Global Warming

The Novel Laureate discussed the irrefutable case for anthropogenic climate change. “There is a mountain of climate data going back to 1860.” Climate deniers say that humans are not causing global warming; rather it is a variance of solar energy including sun spots. Dr. Chu presented a chart showing the long-term continued rise in the global surface temperature while the solar energy reaching the atmosphere followed a predictable 11-year cycle of 1366 and 1367 watts per square meter (W/m²).

CO2 concentration has increased 40% since the start of the first industrial revolution, including all GHG such as methane the equivalent increase has been 50%. Irrevocable effects are under way. The Earth must warm until a new equilibrium is reached in about 150 years due to time lags such as deeper ocean warming. Added temperature increase will result from the long life of greenhouse gases, such as CO2, and from increased emissions.

The effects of warming can be measured. Satellites can now measure with good precision the mass of the earth. Dr. Chu observed that the ice mass is decreasing quadratically in the Greenland and decreasing in the Antarctic.

He also pointed to potential tipping points. There are huge uncertainties with the risk of 3.5 to 6 degree temperature increases.

United States Innovation in Energy Efficiency, Renewables, and Transportation“The U.S. innovation machine is the greatest in the world,” said Dr. Chu. “When given the right incentives, [it] will respond.” Energy efficiency and renewables present major opportunities.

The U.S. market share of photovoltaics peaked in 1996 at over 40 percent of global production;it is now less than 10%. Asia has the lead in batteries. China is spending $9 billion a month on clean energy. For example, the State Grid is investing $44 billion by 2012 and $88B by 2020 in UHV transmission lines with transmission losses over 2,000 kilometers that are less than 5%. China is committed to produce 100GW of wind power by 2020.

The United States Recovery Act is making an $80 billion down payment on a clean energy economy to regain our global competitiveness and create U.S. jobs. Dr. Chu described how the United States could be the world’s innovative leader. The most immediate opportunity is in energy efficiency.

Since 1975, the electricity saved from energy efficient refrigerators with smaller compressors exceeds the total energy produced from wind and solar. Consumers respond to Energy Star ratings. We are expanding our energy efficiency standards to include buildings. In answering a question, Dr. Chu noted that energy efficiency can be extended beyond buildings to city blocks and cities themselves. The Energy Secretary got laughs from the students when he demonstrated how to adjust the sleep mode settings on their PCs and Macs.

Optimistic about Research Breakthroughs

There is good reason for optimism for renewable energy. The cost factor of wind power has decreased by a power of ten. Learning curves for photovoltaics has also declined by over a factor of ten. On a large roof, the installed solar cost is still around $4 per watt. If you get to $1.50 per watt installed, solar takes off without subsidy.

Because renewables are variable they benefit from local and grid storage, and from a smart grid. Pumped water storage is often 75% efficient; compressed air has the potential to be 60 percent efficient. The DOE has funded research for a variety of grid and vehicle battery chemistries.Currently the United States is dependent on oil. Most proven reserves for oil majors such as Exxon, BP, Shell, are now off-shore. It will cost more to extract from tar sands and with more CO2 emissions.

Transportation is the hardest area to improve, mused Dr. Chu. Liquid petroleum fuels have excellent energy density. A Boeing 777 departs with 45% of its weight in jet fuel which has an energy density of 43 Mj/kg and 32 Mj/liter; a lithium battery, only .54 Mj/kg and 0.9 Mj/liter, yet batteries can compete in cars because of the efficiency of electric drive systems and learning curve improvements. We need an automotive battery pack for less than $10,000 with 5,000 deep discharges and 5X higher storage capacity, stated Dr. Chu.We need breakthroughs. Much can from great research labs, such as Dr. Chu’s former Bell Labs. Scientific research for new breakthroughs will be encouraged with multiple programs:

Energy Secretary Chu concluded with the first view of Earth from the Apollo 8 orbit of the lunar surface and with these two quotations:

“We came all this way to explore the moon and the most important thing is thatwe discovered the Earth. – U.S. Astronaut Bill Anders (Dec 24, 1968)

“…We are now faced with the fact, my friends, that tomorrow is today. We are confronted with the fierce urgency of now. In this unfolding conundrum of life and history, there is such a thing as being too late.” – Dr. Martin Luther King (1967)

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The U.S. wind industry broke all previous records by installing 9,922 MW installed last year. This expanded the nation’s wind fleet by 39% and bring total wind power generating capacity in the U.S to over 35,000 MW. The five-year average annual growth rate for the industry is also 39%. U.S. wind projects today generate enough to power the equivalent of 9.7 million homes, protecting consumers from fuel price volatility and strengthening our energy security.

Wind power and natural gas are the leading sources of new electricity generation for the United States, generating 80% of new capacity, as most utilities avoid the risks of adding coal and nuclear power plants.

The 39% expansion of wind power is remarkable because many projects required hundreds of millions in long-term financing during the sever recession and time when many banks stopped lending. Also, many lenders who previously wanted production tax credits (PTC), lost money in 2009 and had no need for PTC.

There is mixed optimism about wind power’s continued growth will continue in 2010. Three GW of new wind are under construction with more projects that will be added during the year. TVA added 815 MW is a good example.

Improved price-performance of equipment is one driver. 1603 Treasury Grants (Excel spreadsheet of 240 Funded Projects), Investment Tax Credit, and other tax credit with completion deadlines will also fuel growth in 2010. RPS in 30 states is another driver.Without new energy or climate legislation we may not see added growth of wind and other renewables. Uncertainty is a deal killer. Lack of new high-speed electricity transmission is the biggest obstacle to growth of renewables. NIMBY activism and lack of appropriate cost sharing are challenges for high-speed transmission.

Natural gas growth may surge ahead if wind growth stalls in 2010. Utilities also prefer natural gas power plants for baseload power. In the decade ahead, large-scale grid storage may make the variability of wind power less of an issue. Report about 32 new grid storage and smart grid projects.

“The U.S. wind energy industry shattered all installation records in 2009, chalking up the Recovery Act as a historic success in creating jobs, avoiding carbon, and protecting consumers,” said AWEA CEO Denise Bode. “But U.S. wind turbine manufacturing – the canary in the mine — is down compared to last year’s levels, and needs long-term policy certainty and market pull in order to grow. We need to set hard targets, in the form of a national Renewable Electricity Standard (RES), in order to provide the necessary stability for manufacturers to expand their U.S. operations and to seize the historic opportunity we have today to build up a thriving renewable energy industry.”

Early last year, before the Recovery Act (ARRA), the industry anticipated that in 2009 wind power development might drop by as much as 50% from 2008 levels, with equivalent job losses. The clear commitment by the President to create clean energy jobs and the swift implementation of ARRA incentives by the Administration in mid-summer reversed the situation.

Recovery Act incentives spurred the growth of construction, operations and maintenance, and management jobs, helping the industry to save and create jobs in those sectors and shine as a bright spot in the economy. Some 50 U.S. facilities are planning expansion, including turbine manufacturers headquartered outside the U.S., although some will need financing and greater market certainty to expand. The United States competes with Europe and Asia for wind industry job growth. In 2009, most U.S. wind projects were divided among a dozen turbine manufacturers such as General Electric, Vestas, Suzlon, Siemens, and Mitsubishi.

America’s wind power fleet will avoid an estimated 62 million tons of carbon dioxide annually, equivalent to taking 10.5 million cars off the road, and will conserve approximately 20 billion gallons of water annually, which would otherwise be withdrawn for steam or cooling in conventional power plants.

Texas extended its lead benefiting from strong winds and fewer regulatory hurdles than many states in the nation. Fourteen U.S. states now have over 1 GW of installed wind. The top five states by wind power installed (in MW):

Can wind power continue to grow? Yes. The November 2009 feature article in Scientific American reported how wind, water and solar technologies can provide 100 percent of the world’s energy, eliminating all fossil fuels by 2030. Recommended reading is “A Plan to Power 100 Percent of the Planet with Renewables“ by Mark Z. Jacobson and Mark A. Delucchi.

The last time EWEA convened its offshore event, in December 2007 in Berlin, the mood was relatively somber. Several major offshore wind projects had been completed, but had run into unforeseen technical and economic challenges. European policies and regulations for the next phase of offshore wind energy were in flux. Although everyone was convinced that offshore wind was going to be a significant growth sector in the European energy mix, there were real doubts as to when such opportunities would actually come to fruition.

Last week, EWEA held their 2009 offshore event in Stockholm, where 4,750 attendees (up from about 2,000 in Berlin two years ago) congregated to celebrate what is now clearly emerging: a boom in offshore wind in Europe over the next decade. EWEA projects 50 gigawatts of offshore wind installed by 2020. With 20 gigawatts of projected installation, the United Kingdom is making a play to steal (or at least share) German leadership in offshore wind manufacturing and deployment.

Wind manufacturers are clearly bullish. Recently, Siemens (XETRA: SIE) has established a separate business unit for offshore wind, with well over 100 employees — and still hiring. Also, General Electric (NYSE: GE) acquired ScanWind, a Scandanavian turbine manufacturer, to gain a product specifically designed for offshore application, thereby getting back in the offshore game after retrenching in the wake of its initial foray in Arklow Ireland a few years ago. At the exhibition, Vestas (NASDAQ OMS Copenhagen: VMS) unveiled a new model, the V112-3.0, for the offshore market.

So, the offshore wind industry seems to be really taking off – in Europe. Here in the U.S., as is the case with so many things on the energy front, we’re years behind.

In its industry roadmap, projecting how the U.S. could achieve the aspiration (set by both the Bush and Obama Administrations) in which 20% of the nation’s electricity supply would come from wind energy by 2030, analysis by the U.S. Department of Energy indicates that about 50 gigawatts would probably need to come from offshore wind. This is not because there’s insufficient onshore wind resource in the U.S., but rather, that most of this resource is too far removed from demand centers in the East and access to transmission would be problematic.

Developers are increasingly exploring opportunities in U.S. offshore wind, mainly along the North Atlantic, due to favorable policies and market conditions in states like New Jersey, Delaware, Maryland, and Rhode Island. In the Great Lakes — likely to be a separate market from the Atlantic for geographic and logistics reasons — the Cleveland area is pursuing offshore wind, and so are parties in New York, Michigan and Wisconsin.

While the private sector is most eager (and naturally so) to find lucrative profit opportunities, civic leaders in each of these areas are taking steps to encourage offshore wind from a job-creation perspective, aiming to attract manufacturing activity and all of the logistics services – shipping, engineering, installation, maintenance – that come with significant development of offshore windfarms.

The good news is that many of these jobs for offshore wind pretty much have to be done locally. The bad news is that, at least when it comes to technological leadership in offshore wind, the U.S. has pretty much absent from that game, with the massive 10 MW Brittania design by Clipper Windpower (AIM: CWP) being the only American exception — although, it should be noted, its initial deployment is planned for the U.K.

The worse news is that offshore wind is not on a track to becoming a significant activity in the U.S. for at least 5 and probably more like 10 years. In the above-noted DOE study, offshore wind penetration only begins in the late 20-teens. This is because there’s nowhere near the degree of policy commitment to offshore wind in the U.S. as is seen in Europe. In turn, this is because Europe has less developable land, greater renewable energy and environmental aspirations, and higher electricity prices than the U.S.

So, akin to Thomas Friedman’s “Have A Nice Day” op-ed piece in the New York Times last week, the U.S. has clearly abdicated leadership in offshore wind to other countries.

Until the profit prospects become significant, developers will find it challenging to explore offshore wind energy opportunities in the U.S. For the U.S. market to really bloom, this puts the burden on the suppliers of offshore windfarms – not just the turbine manufacturers, but also those who are working on foundation, erection and shipping designs – to drive the costs of offshore wind down to competitive levels in a timely fashion (10 years?).

The private sector is likely to need a “carrot”, in the form of some supportive public policy, to make the investments in technological advancement for offshore wind energy that ultimately produce a self-sustaining growth industry.

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Despite all the optimistic talk about green jobs in the advanced energy economy of the future, many manufacturers from the industrial heartland are deathly afraid of the potential passage of climate change legislation, concerned that cap-and-trade will increase their electricity costs and thereby make their operations less profitable.

The article in The Plain-Dealer reporting on Timken’s results painted a very bleak picture — right up until the very last paragraph, in which a Timken spokesperson noted that the wind industry represented a “bright spot” for the company. Across town, Crain’s Cleveland Business was profiling Timken’s $200 million in recent investments to more aggressively pursue the “fast-moving” wind industry.

Of course, the “bright spot” afforded to Timken by the “fast-moving” wind sector will only remain attractive if it maintains momentum — something that is far more likely to occur if climate legislation is passed. On the other hand, it is all the other pieces of Timken’s business — the ones that are currently in the dumps — that many of those who oppose climate legislation are trying to protect.

It may be a leap of faith for a company to make a bold manufacturing commitment away from mature (in many cases, dying) industries of the past towards high-growth industries of the future — such as renewable energy. But the results of Timken suggest that those who try to make this shift at least have a chance at pockets of profitability even in these trying times, while those who avoid or defer this transition may face a lingering period of weak and declining prospects.

Manufacturers who protest against the Waxman-Markey bill may be spitting in the face of one of the few good manufacturing opportunities available to them in the coming decades. It’s time for the manufacturing world to build bridges to the future, rather than digging tunnels to the past.

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Boone Pickens announced this week that his mega wind farm was icing an eventual 4,000 MW windfarm this week. Apparently he’s looking for buyers for $2 Bill in turbines. A far cry from a year ago when your credibility as a wind developer hung in part on whether or not you had turbine supply.

As difficulty constructing the transmission lines was the stated reason for the the about face, I guess even Texas can’t always throw up a transmission line wherever it wants. California utilities have been struggling with this issue for years.

T&D remains the seminal issue, second only to how big are the subsidies and RPS requirements, in building renewables into true scale.

And for those of you who haven’t read the Pickens Plan to switch a chunk of our power sector from gas to wind, and a chunk of our transport sector from oil to gas, details here.Neal Dikeman is a partner at Jane Capital Partners, and has cofounded, run, invested in, or served as a director of multiple startups in cleantech and technology. He is Chairman of Carbonflow and Cleantech.org, and Texas Aggie.

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